Scholars have long debated why certain common law breaches in American jurisprudence receive criminal punishment – possible loss of liberty at the hands of the state – while others only receive civil sanctions or monetary damages sought by individuals. Scholars like Richard Posner and Guido Calabresi have used economic-based models and the notion of efficiency to explain why tort breaches only receive civil sanctions but criminal breaches receive punishment. Others like John Coffee and Paul Robinson have questioned the explanatory power of these models. Instead, they have focused on the moral difference between torts and crimes. Simply put, a crime’s intentional nature makes it morally worse than the carelessness typified by tortious activity. Interestingly, scholars on both sides of the debate have largely neglected to include contract breaches – a significant part of common law – into their models. Like torts, these breaches also only receive civil sanctions. What explains the similar treatment?

This Article makes an original contribution to the literature by systematically introducing contract breaches into the broader criminal/civil debate. It employs the aforementioned economic and moralist models in an effort to understand the treatment of contract breaches. The economic model, and its focus on efficiency, predictably explains why these breaches only receive civil sanctions. The moralist model stumbles here. Its focus on intent suggests that a contract breach – as intentional conduct – also deserves moral blame and thus punishment. What is missing is an understanding of the moral nature of a contract breach and specifically the difference between a voluntary moral obligation and a pre-existing moral duty. This Article takes the innovative step of introducing this distinction into the larger criminal/civil debate and using it to conclude that the moralist and economic approaches can be integrated into a unified model.